The Lottery Should Pay More Than 50% In Prizes To Lottery Players.Prev Topic Next Topic

New Topic New Poll

four4me

MD
United States
Member #1,701
June 18, 2003
10,731 Posts
Offline

Jun 25, 2014, 12:06 am

Quote: Originally posted by THRIFTY on Jun 24, 2014
THE LOTTERY SHOULD KEEP LESS MONEY.

50% PAYBACK RATE IN PRIZES IS NOT ENOUGH.

"Look, the lottery company operates on a 50% payback rate. In other words, for every $100,000 they collect from ticket sales, they only pay out about $50,000 to winning tickets. At a 50% payback rate, no other standard bet on the planet comes even close to being as bad as buying lottery tickets. The lottery is a TAX on the poor and on the ignorant." By PDQ

what about operating expenses, salaries, etc

Big John says. You don't hit the number. The number hits you!!!!

I'm not Big John, I'm Four4me, Big John's a friend.
noise-gate

* In hot pursuit of $ *

White Shores- California
United States
Member #136,469
December 12, 2012
7,257 Posts
Online

Jun 25, 2014, 12:37 am

Quote: Originally posted by four4me on Jun 25, 2014
what about operating expenses, salaries, etc

Good Point- here's my 2 cents worth.

If " most" States are spearheading the movement towards computerized games, why should the people running these shows be picking up a cheque. After all- the machines are doing all the work... .right? Unless they want to be paid for " tampering" with the machines!
eddessaknight

LAS VEGAS
United States
Member #47,728
November 22, 2006
9,623 Posts
Offline

Jun 25, 2014, 1:36 am

Quote: Originally posted by noise-gate on Jun 25, 2014
Good Point- here's my 2 cents worth.

If " most" States are spearheading the movement towards computerized games, why should the people running these shows be picking up a cheque. After all- the machines are doing all the work... .right? Unless they want to be paid for " tampering" with the machines!

Another point, well taken NG

Eddessa_Knight
four4me

MD
United States
Member #1,701
June 18, 2003
10,731 Posts
Offline

Jun 25, 2014, 2:30 am

Quote: Originally posted by noise-gate on Jun 25, 2014
Good Point- here's my 2 cents worth.

If " most" States are spearheading the movement towards computerized games, why should the people running these shows be picking up a cheque. After all- the machines are doing all the work... .right? Unless they want to be paid for " tampering" with the machines!

operating expenses include all the employees all the vendors all the buildings the rent or building and maintaining of said buildings the advertising eats up a large chunk of that scratch tickets printing and everything else you have to spend money on in order to maintain said business the lottery is a business if it doesn't generate a profit it will go out of business.

Big John says. You don't hit the number. The number hits you!!!!

I'm not Big John, I'm Four4me, Big John's a friend.
Teddi

United States
Member #142,491
May 13, 2013
1,394 Posts
Offline

Jun 25, 2014, 8:59 am

Quote: Originally posted by noise-gate on Jun 25, 2014
Good Point- here's my 2 cents worth.

If " most" States are spearheading the movement towards computerized games, why should the people running these shows be picking up a cheque. After all- the machines are doing all the work... .right? Unless they want to be paid for " tampering" with the machines!

Doesn't computerization only mean a decrease in salaries, not an elimination of them. And wherever there's a network, that also means a highly paid IT department and all the costs associated with the upkeep and upgrade of equipment. Plus the requisite accountants, PR/advertising/marketing personnel, a fraud department, legal counsel, etc etc etc.

I too would prefer Cersei Lannister to Tiny Hands. She always pays her debts, hasn't filed 6 bankruptcies and is educated enough to know Nambia isn't a country.
noise-gate

* In hot pursuit of $ *

White Shores- California
United States
Member #136,469
December 12, 2012
7,257 Posts
Online

Jun 25, 2014, 9:58 am

Quote: Originally posted by Teddi on Jun 25, 2014
Doesn't computerization only mean a decrease in salaries, not an elimination of them. And wherever there's a network, that also means a highly paid IT department and all the costs associated with the upkeep and upgrade of equipment. Plus the requisite accountants, PR/advertising/marketing personnel, a fraud department, legal counsel, etc etc etc.

Yes it does Teddi- my remarks were meant to be taken as playful banter.
EdG1955

Marana AZ
United States
Member #145,333
August 3, 2013
275 Posts
Offline

Jun 25, 2014, 5:57 pm

What about the retailers? Ohio, for example, pays a commission of 5.5% for each ticket sold. Then you have the employees who stock stores with tickets and lotto promotional material. Auditors. Security. Cost of the tickets themselves. Lottery terminal. Communications network. Guaranteed minimum for state per state law. Etc, etc. It's ridiculous to think a state could operate a lottery with 80% payouts. Or even 70%.
LottoMetro

Happyland
United States
Member #146,336
September 1, 2013
1,182 Posts
Offline

Jun 25, 2014, 6:18 pm
Quote: Originally posted by EdG1955 on Jun 25, 2014
What about the retailers? Ohio, for example, pays a commission of 5.5% for each ticket sold. Then you have the employees who stock stores with tickets and lotto promotional material. Auditors. Security. Cost of the tickets themselves. Lottery terminal. Communications network. Guaranteed minimum for state per state law. Etc, etc. It's ridiculous to think a state could operate a lottery with 80% payouts. Or even 70%.

Massachusetts Lottery pays out 72%. There are games in probably every state that pay out up to 75% or more, if you know where to look. Ironically, the games that pay the best are generally the ones with the most overhead. I've never quite understood this but I believe it has to do with volume.
- If the chances of winning the jackpot are so slim, why play when the jackpot is so small? Your chances never change, but the potential payoff does.
- If a crystal ball showed you the future of the rest of your life, and in that future you will never win a jackpot, would you still play?
- I believe Joan Ginther ("world's luckiest woman") merely played lottery as a tax strategy. Evidence: zero prize claims through 10 years after her last Lotto Texas annuity payment!
THRIFTY

NEW YORK
United States
Member #90,529
April 29, 2010
13,411 Posts
Offline

Jun 25, 2014, 6:23 pm

Quote: Originally posted by EdG1955 on Jun 25, 2014
What about the retailers? Ohio, for example, pays a commission of 5.5% for each ticket sold. Then you have the employees who stock stores with tickets and lotto promotional material. Auditors. Security. Cost of the tickets themselves. Lottery terminal. Communications network. Guaranteed minimum for state per state law. Etc, etc. It's ridiculous to think a state could operate a lottery with 80% payouts. Or even 70%.

The lottery can pay back 70% or more, if The Lottery increases the tickets cost to $5. How much can you mess around with the games matrices without increasing the tickets cost to more than $2? Powerball realized this situation a long time ago.
THRIFTY

NEW YORK
United States
Member #90,529
April 29, 2010
13,411 Posts
Offline

Jun 25, 2014, 6:27 pm

Quote: Originally posted by LottoMetro on Jun 25, 2014
Massachusetts Lottery pays out 72%. There are games in probably every state that pay out up to 75% or more, if you know where to look. Ironically, the games that pay the best are generally the ones with the most overhead. I've never quite understood this but I believe it has to do with volume.

It is no longer about insane odds of winning. Tickets cost and Big Payback Rates in prizes is the new business.
THRIFTY

NEW YORK
United States
Member #90,529
April 29, 2010
13,411 Posts
Offline

Jun 25, 2014, 6:31 pm

Quote: Originally posted by EdG1955 on Jun 25, 2014
What about the retailers? Ohio, for example, pays a commission of 5.5% for each ticket sold. Then you have the employees who stock stores with tickets and lotto promotional material. Auditors. Security. Cost of the tickets themselves. Lottery terminal. Communications network. Guaranteed minimum for state per state law. Etc, etc. It's ridiculous to think a state could operate a lottery with 80% payouts. Or even 70%.

THE LOTTERY IS IN BUSINESS TO MAKE MONEY.
EdG1955

Marana AZ
United States
Member #145,333
August 3, 2013
275 Posts
Offline

Jun 25, 2014, 6:32 pm

Quote: Originally posted by LottoMetro on Jun 25, 2014
Massachusetts Lottery pays out 72%. There are games in probably every state that pay out up to 75% or more, if you know where to look. Ironically, the games that pay the best are generally the ones with the most overhead. I've never quite understood this but I believe it has to do with volume.

The amount of payout is set by state law. Most states dedicate 20% to 30% of winnings to designated purposes such as education or seniors programs or other state budget items. Subtract that from the top line then subtract retailer commissions plus overhead and you end up with the payout. Interestingly, Massachusetts has the highest payout at 71.9% and also has the highest lottery spending per adult of all the states at $861, almost double the number 2 state.

See: http://blog.sfgate.com/pender/2012/03/14/georgia-tops-lottery-sucker-list-california-ranks-low/
THRIFTY

NEW YORK
United States
Member #90,529
April 29, 2010
13,411 Posts
Offline

Jun 25, 2014, 7:11 pm

Quote: Originally posted by EdG1955 on Jun 25, 2014
The amount of payout is set by state law. Most states dedicate 20% to 30% of winnings to designated purposes such as education or seniors programs or other state budget items. Subtract that from the top line then subtract retailer commissions plus overhead and you end up with the payout. Interestingly, Massachusetts has the highest payout at 71.9% and also has the highest lottery spending per adult of all the states at $861, almost double the number 2 state.

See: http://blog.sfgate.com/pender/2012/03/14/georgia-tops-lottery-sucker-list-california-ranks-low/

A lottery is a “Zero-sum game”. What one group of participants gains in cash, the other group of participants must lose. If we made a list of all the participants in a lottery, it might include:

1) Federal Government (Lottery winnings are taxable)
2) State Governments (Again lottery winnings are taxable)
3) State Governments (Direct share of lottery ticket sales)
4) Merchants that sell tickets (Paid by the lottery organizers)
5) Lottery companies (Hint: They are not doing all this for free)
6) Advertisers and promoters (Paid by the lottery companies)
7) Lottery ticket buyers (Buy lottery tickets and receive payouts)

The winners in the above list are:
1) Federal Government
2) State Government (Taxes)
3) State Government (Direct share)
4) Merchants that sell tickets
5) Lottery companies
6) Advertisers and promoters

And the losers are:
(Mathematically challenged and proud of it). By Durango Bill
LottoMetro

Happyland
United States
Member #146,336
September 1, 2013
1,182 Posts
Offline

Jun 25, 2014, 8:31 pm
Quote: Originally posted by EdG1955 on Jun 25, 2014
The amount of payout is set by state law. Most states dedicate 20% to 30% of winnings to designated purposes such as education or seniors programs or other state budget items. Subtract that from the top line then subtract retailer commissions plus overhead and you end up with the payout. Interestingly, Massachusetts has the highest payout at 71.9% and also has the highest lottery spending per adult of all the states at $861, almost double the number 2 state.

See: http://blog.sfgate.com/pender/2012/03/14/georgia-tops-lottery-sucker-list-california-ranks-low/

The amount of payout isn't set by law in all states. Most follow "standard practices" which is minimum 50% but if they wanted to, legally they could reduce it. Massachusetts has the highest spending mostly because they have the highest payouts. IMO spending doesn't matter unless you take into account the payout. If I the player can spend $861 and on average, get back $619 of it, that is still better than spending $470 in Georgia and on average only getting back $296 of it. The Mass. Lottery has even publicly admitted that their high payouts are what earn their high sales.

The game payout I am speaking of does not factor in overhead. It is determined by dividing the total value of all prizes into the total cost of all tickets to the players. So a game that doles out $50 million in prizes out of $75 million worth of tickets would have 66.67% payout. The overhead and cost of manufacturing the tickets is deducted from the gross revenues. Now overall (across the portfolio of all offered games), the total payout will typically "averaged" less. Lotteries have low overhead with draw games and they use lower payouts in these games to help pay the overhead on higher payout games (the irony I spoke of). You can find plenty of games with payouts higher than 70%, and if you played only those games over time your payout would be higher than the overall. The payout percentage that the lottery and media quotes is simply an average of all their games.
- If the chances of winning the jackpot are so slim, why play when the jackpot is so small? Your chances never change, but the potential payoff does.
- If a crystal ball showed you the future of the rest of your life, and in that future you will never win a jackpot, would you still play?
- I believe Joan Ginther ("world's luckiest woman") merely played lottery as a tax strategy. Evidence: zero prize claims through 10 years after her last Lotto Texas annuity payment!
yinchaoji

BEIJING
China
Member #90,440
April 28, 2010
159 Posts
Offline

Jun 26, 2014, 12:43 am

I SAW "Your Pick 3 $1.00 Ticket Payout $900 ", is it true?

New Topic New Poll

Subscribe to this topic

The Lottery Should Pay More Than 50% In Prizes To Lottery Players.Prev TopicNext Topic

The Lottery Should Pay More Than 50% In Prizes To Lottery Players.Prev Topic Next Topic